Onome Amuge
Gold prices slipped after hitting fresh record highs earlier in the session, as investors digested signals from the Federal Reserve that the pace of US rate cuts could remain cautious.
Spot gold fell 0.9 per cent to $3,658.25 per ounce, retreating from a record $3,707.40 earlier in the day. US gold futures for December delivery settled 0.2 per cent lower at $3,717.80. Even with the pullback, bullion has gained nearly 6 per cent so far this month and 39 per cent since the start of the year.
The retreat followed the Fed’s decision to lower its benchmark rate by a quarter of a percentage point, its first cut in 2025 and the fourth since early 2024. While policymakers signalled further easing ahead, chair Jerome Powell stressed that decisions would be made “meeting by meeting” and described the move as a risk-management step in response to a softening labour market.
“The Fed is signalling uncertainty with Powell calling this a ‘risk-management’ cut, which has triggered some quite understandable profit-taking. A retracement or at least a consolidation is healthy. Unless we get below major technical support at $3,550, the short-term uptrend should remain intact,” said Tai Wong, an independent metals trader.
Lower interest rates generally enhance the appeal of non-yielding assets such as gold, reducing the opportunity cost of holding bullion. Analysts said the broader trajectory remained supportive for the metal, despite short-term profit-taking.
The rally has also been driven by resilient safe-haven demand amid geopolitical tensions, trade frictions and portfolio diversification away from the US currency. Central banks have continued to add to their gold reserves, further underpinning demand.
Deutsche Bank this week raised its 2026 price forecast for gold to an average of $4,000 per ounce, up from $3,700, citing structural drivers including dedollarisation trends and persistent geopolitical risk.
Gold’s pullback reverberated across the precious metals complex as spot silver slipped 2.4 per cent to $41.51 per ounce, platinum dropped 2.2 per cent to $1,360, and palladium fell 2.6 per cent to $1,145.44.
Analysts said the moves reflected profit-taking across the sector rather than a shift in underlying fundamentals.While some traders expect further consolidation in gold after a blistering rally, many see structural support keeping prices elevated.
